FIELD NOTES / CHINA BUSINESS
STARTING A BUSINESS IN CHINA
01.
Practical insights from working with foreign entrepreneurs
PERSPECTIVE / FROM THE FIELD
I work at a business consulting firm in China, helping foreign entrepreneurs and companies establish their businesses here. One thing I have noticed is that the business services people use in China can be quite different from those in other countries.
In many countries, your first instinct may be to call a lawyer when you need to register a company, obtain a business license, or arrange a work visa. In China, however, things often work a little differently.
In this series, I want to share practical knowledge from my daily work—not a sales pitch. I hope these notes help you understand the process, avoid unnecessary costs, and make better decisions before starting a business in China.
“Company registration is only the beginning.”
The real question is how to establish your company without taking on unnecessary costs or obligations.
IN THIS ARTICLE
01Who helps you register?
02Are government fees required?
03What documents are needed?
04Four registration decisions to get right
THE SERVICE SYSTEM
01.
Many small businesses in China use accounting or company-registration agencies rather than law firms to handle routine registration. The reason is simple: company formation is only the beginning.
After registration, a company must maintain accounting records and comply with applicable tax-filing obligations—even when it has not started generating revenue. Hiring a full-time accountant immediately may be expensive for a startup, so a bookkeeping agency can be a practical choice.
Using an agency is not mandatory. In suitable cases, you can apply yourself through the local government registration system. For complex ownership structures, regulated industries, or legal disputes, specialist legal advice may still be important.
PRACTICAL TAKEAWAY
An accounting agency may cover both initial registration and recurring bookkeeping. Ask what is included in the service fee before you engage one.
REGISTRATION COSTS
02.
Here is something that surprises some foreign entrepreneurs: standard company establishment registration in many Chinese cities does not carry a government registration fee. You do not necessarily have to pay an agency merely to obtain a business license.
Once you choose a city, look for its official business-registration portal and check whether online filing is available to foreign investors. Identity verification, signatures, translations, and supporting documents may make a foreign-invested application more involved than a domestic one.
“Free registration” does not mean “zero startup cost.” A lawful registered address, bookkeeping, document preparation, bank arrangements, and sector-specific permits may still cost money.
Registration fee ≠ startup cost
Even when the government registration itself is free, address services, accounting, document preparation and sector-specific licensing can create additional expenses.
BEFORE YOU FILE
03.
Before starting the application, prepare the basic company information:
01Proposed company name
02Registered capital
03Business scope
04Registered address and supporting evidence
05Identity and contact details of shareholders, the legal representative, and relevant officers
You may also need articles of association, appointment documents, and additional documents relating to foreign shareholders. Exact requirements vary by city and company structure.
FOUR KEY DECISIONS
01 / COMPANY NAME
A company registered in mainland China needs a compliant official Chinese name. An English translation can be used in international communication, but it is not a substitute for the Chinese name shown on the business license.
A common naming structure is: Administrative Region + Trade Name + Industry + Company Form.
COMMON NAMING STRUCTURE
Region + Trade Name + Industry + Company Form
Example: 广州市爱客企业咨询有限公司 English rendering: Guangzhou Aike Enterprise Consulting Co., Ltd.
If you do not speak Chinese, choosing the name may feel unfamiliar. It is worth checking its meaning, availability, and consistency before you submit.
02 / REGISTERED CAPITAL
For most ordinary limited liability companies, China has no universal minimum registered-capital amount, although certain industries have special rules.
Under the revised Company Law effective July 1, 2024, shareholders of newly established limited liability companies generally must pay in their subscribed capital within five years of establishment, subject to applicable exceptions and rules.
For example, registering RMB 1 million of capital generally means undertaking to contribute that amount within the statutory period. My practical advice: do not choose a large figure merely to make the company look impressive. Match it to your financing plan and potential liabilities.
Remember:A large registered capital amount is a funding commitment, not simply a marketing statement.
03 / BUSINESS SCOPE
When you register a company, you must describe the activities it intends to carry out. Broadly, there are general business activities and activities subject to permits or other regulatory requirements.
General activities normally do not require a separate industry-specific operating permit, provided the activity is otherwise lawful. Licensed activities may require approval, a permit, or filing before they can be carried out. A restaurant, for example, generally needs more than a basic business license and must meet applicable food-safety licensing requirements.
Foreign investors should also check the applicable foreign-investment negative list. An activity that is generally lawful may still be restricted or prohibited for foreign investment.
Foreign investment check:Review whether your planned activity is restricted under the applicable negative list before finalizing your scope.
04 / REGISTERED ADDRESS
Every company needs a legally valid registered address. But this does not always mean renting a dedicated office from day one.
In some cities or districts, approved business-address services, incubators, or shared-office arrangements may be accepted for registration. They can reduce initial costs for consulting or trading businesses that do not need a full-time office.
Rules differ locally, and certain activities require actual operating premises. Before paying for an address, confirm that it is eligible for registration in that district and suitable for your specific activity. Do not rely on an address that cannot legally support your registration.
ONE FINAL THOUGHT
Know what you are paying for — and what you are committing to.
Good preparation helps you manage costs, understand your obligations and start your business on a more solid footing.
FROM MY EXPERIENCE
Starting a business in China may look complicated when you are unfamiliar with the language and local procedures. But once you understand the system, some steps are simpler than you might expect.
One lesson from my work is that knowing what you really need to pay for matters just as much as knowing how to register.
I hope this first article is useful. In the next parts, I will continue sharing practical lessons for foreign entrepreneurs before and after company establishment. What questions would you like me to cover?
STARTING A BUSINESS IN CHINA / PART 01
This article shares general practical experience, not legal or tax advice. Requirements may vary by city, industry and investor structure.
ABOUT OUR FIRM
AIKE Enterprise Consulting
Guangdong, China · Business Setup & Corporate Services
We assist international entrepreneurs and businesses with company establishment and ongoing corporate compliance in China.
WHAT WE DO
Company Registration · Registered Business Addresses
Bookkeeping & Tax Filing · Foreign National Work Permits
Foreign Investment Guidance · FDI Filings
Import & Export Licensing · Food & Restaurant Licensing
CONTACT & LOCATION
Phone:+86 176 8823 6372
WhatsApp:+86 139 2942 6196
WeChat:17688236372
No. 167 Linhe West Road, Tianhe District, Guangzhou, China
AIKE Enterprise Consulting (Guangdong) Co., Ltd. | Guangzhou, China